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How we pay for our richest landowners

From £2.7m for Serco to £750,000 to the Duke of Westminster, an NS investigation shows just how much our biggest landowners receive each year in state handouts.

A political consensus has hardened that there are too few houses being built and that our planning laws are too restrictive. Equally most people seem to believe that too much of Britain, especially England, has been bulldozed and obliterated; that our land is less pleasant and less green with each passing year. In fact, only 10.6 per cent of England (and 6 per cent of Britain) is developed. The myth spun about this country is that land is scarce. It is not – landowners, many of them aristocrats who acquired their land through a quirk of ancestral good luck or who benefited from the Norman Conquest, the dissolution of the monasteries or the enclosure of common land, are paid to keep it off the market through a system of European Union agricultural subsidies (see table below). What is scarce is land on which there is planning permission to build.

Yet the question of who owns Britain, how the land came to be owned and what it means for the rest of us has never been answered adequately. The Labour Party, for example, never speaks of the need for a land value tax (which is supported by Martin Wolf, the Financial Times’s influential economics commentator) and does not mention land reform, which was once a great reforming Liberal cause.

It was Britain’s iniquitous system of land ownership that prompted Herbert Asquith to pass the Parliament Act in 1911 and assert the primacy of the House of Commons over the House of Lords, one of the most redoubtable defenders of the landed interest.

More than a century later, the situation is little improved. The United Kingdom is 60 million acres in size, of which 42 million acres are designated “agricultural” land and 12 million are “natural wastage” (forests, rivers, mountains) owned by institutions such as the Forestry Commission, the Ministry of Defence and the National Trust. The remaining six million acres are the “urban plot”, the densely congested land on which our houses, factories and offices are built. (Most of the 62 million people of these islands live on just three million acres.)

What this means, in effect, is that 69 per cent of British acreage is owned by less than 1 per cent of the population, or 158,000 families
(the so-called cousinhood), a concentration of ownership unrivalled in western Europe with the exception of the kingdom of Spain.

Green, unpleasant land

This maldistribution of land is one of the primary, if largely unacknowledged, causes of the current housing crisis. Though there is no shortage of land in Britain, little of it is available for development, given the enduring dominance of a landowning elite. The frequent lament
that the countryside has been “concreted over” is unsupported by evidence. The UK National Ecosystem Assessment, published in 2011, and the most comprehensive survey of the country’s natural environment and resources ever undertaken, concluded that just 6.8 per cent of the UK’s land area could be classified as urban. Even this figure overstates the extent of development. In England, for instance, where 10.6 per cent of land is designated as urban, 54 per cent of that total is green space (parks, sports pitches, cemeteries and so on), with domestic gardens accounting for 18 per cent and water (rivers, canals, lakes and reservoirs) for 6.6 per cent. In sum, 78.6 per cent of English urban land is designated as “natural” rather than built.

In the UK as a whole, it is “enclosed farmland” that accounts for by far the largest share of land (40 per cent), followed by mountains, moorlands and heath (18 per cent) and woodland (12 per cent, a figure that has doubled since 1945). For those who question why UK homes are both the smallest in Europe and the most expensive, the answer is that 90 per cent of the population lives on just 5 per cent of the land. Viewed in this context, it is unsurprising that so many believe this is an overcrowded country in which rapacious developers have monopolised what little space remains.

That this system has endured, contrary to all reason, is testimony to the power and influence of those who benefit from it. The largest private landowner, not just in Britain but in Europe, is Richard Scott, the 10th Duke of Buccleuch and 12th Duke of Queensberry, who inherited his property empire on his father’s death five years ago. He owns 240,000 acres, including the Queensberry Estate, with its headquarters in Drumlanrig Castle, Dumfries, and the Langholm Estate on the Dumfriesshire-Cumbria border, worth an estimated £1bn in total. His nearest rivals include the Duke of Westminster, who owns 133,100 acres (worth £6bn) and whose Grosvenor Estate includes the most valuable real estate in London (in Belgravia and Mayfair), and Prince Charles, who, in his cap­acity as Duke of Cornwall, owns 133,602 acres worth between £1bn and £1.2bn.

Were the government to announce that, despite their considerable means, these individuals would receive extensive subsidy from the taxpayer, there would be predictable outrage. Yet, in the form of the EU’s Common Agricultural Policy (CAP), such a programme (let’s call it “aid for aristocrats”) already exists. The average British household contributes £245 a year to the CAP, most of which is handed to the wealthiest landowners. Originally established with the intention of supporting small farmers and reducing Europe’s reliance on food imports, the CAP, which accounts for over 40 per cent (€55bn) of the EU budget, has become a slush fund for assorted dukes, earls and princes. Payment is based on acreage alone and takes no account of wealth, making the scheme one of the most regressive – the more you own, the more you get. In addition, since the EU’s definition of “farmer” does not require individuals to produce food or other agricultural products, many recipients are, in effect, paid not to farm.

A Freedom of Information request by the New Statesman to the Department for Environment, Food and Rural Affairs (Defra) reveals that the largest landowners received millions of pounds in taxpayer subsidy last year. The Duke of Westminster, a multibillionaire, was paid £748,716 for his ownership of Grosvenor Farms, the Earl of Plymouth £675,085, the Duke of Buccleuch £260,273, the Duke of Devonshire £251,729 and the Duke of Atholl £231,188 for his Blair Castle estate. It was also a lucrative year for the Windsors. The Queen received £415,817 for the Royal Farms and £314,811 for the Duchy of Lancaster, while Prince Charles was paid £127,868 for the Duchy of Cornwall. Similarly well-remunerated was Saudi Arabia’s Prince Bandar bin Sultan, who received £273,905 for his 2,000-acre Glympton Estate in Oxfordshire, allegedly purchased with proceeds of the 1985 al-Yamamah arms deal between Britain and Saudi Arabia. The largest individual UK beneficiary is Sir Richard Sutton, who was paid £1.7m for his Settled Estates, the 6,500-acre property near Newbury that he inherited with his baron­etcy in 1981, despite net assets of £136.5m.

Other unlikely recipients include Harrow School, which received £4,622, Severn Trent Water, which was paid £779,436, and the outsourcing company Serco, currently cashing in on the government’s privatisation of NHS services, which, courtesy of the public, received £2.7m in land subsidy. With EU member states simultaneously cutting jobs, wages and services at the behest of Brussels, it is socialism for the rich and capitalism for the poor.

Aware that it cannot legitimately sustain such corporate welfare at a time of austerity, the EU has vowed to reform the programme by capping direct payments at €300,000 and by ensuring that only “active” farmers receive subsidy. But even under these proposals, due to be implemented in 2014, the EU will still provide aid to landowners who derive just 5 per cent of their annual revenue from agricultural activity; and, in the case of the cap, the biggest farms will be able to avoid it simply by restructuring.

The Conservative Party seldom misses a chance to bash the Brussels bureaucrats, and yet, because of its enduring ties to the landed gentry, one hears little from it about the inequity of the CAP or the order it helps sustain.

Land reform is now both a political and an economic necessity for Britain. Here is an issue that should galvanise both the Liberal Democrats and Labour.

Jason Cowley is editor of the New Statesman.

George Eaton is editor of The Staggers blog.

This article first appeared in the 24 September 2012 issue of the New Statesman, Lib Dem special

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View from Paisley: How the Conservatives are wooing Labour's Scottish heartlands

Not so long ago, Conservative activists in Paisley could expect doors slammed in their faces. A referendum has changed that.

Tony Lawler, a Labour activist, was recently knocking on doors in the Scottish town of Paisley, when he came across a disgruntled resident. “I’m really disappointed in Douglas Alexander,” the potential voter complained. “I haven’t seen him. He used to be in Morrisons.”

Douglas Alexander, of course, has gone. He was the longstanding Labour MP and onetime International Development secretary who lost his seat in 2015 to a 20-year-old rival, the Scottish National Party’s Mhairi Black. He does not plan to stand again. But when I visit Paisley, a short train ride from Glasgow, I find that memories of him linger on. 

Two years after Alexander’s defeat, I meet Lawler and other local Labour activists in Morrisons, where Alexander used to hold his surgeries. As checkouts beep and trolley wheels roll over linoleum, they point to an empty table in the corner of this hallowed ground: “He used to sit just there.”

In 2015, the SNP’s victory in this former manufacturing town seemed to epitomise the earthquake in Scottish politics. But as the Labour activists know too well, no political fortress is undefeatable. And in Paisley, the home of one of the oldest workers’ festivals in the world, the party with the most to gain is one that previously never dared to canvass in the high street – the Conservative party. 

The town the Brexiteers forgot

In 1988, the historian Sylvia Clarke reflected on Paisley’s lost industries, wondering what was next for the former weaving towns. “Paisley as a tourist centre?” she wondered, in Paisley: A History. “Paisley as a place for visitors to come to, rather than a send-out of goods and emigrants?” 

For all Paisley’s industrial decline, it’s a pretty place. The town is in the running for the 2021 City of Culture, and has the second biggest number of listed buildings after Edinburgh. When I visit in the middle of April, blossom floats on the trees, and a river meanders through a neighbourhood of old, stone houses. It takes a moment to notice weeds tightening their grasp on the window frames. When I try the door of the ancient Paisley Abbey, it’s locked.

Perhaps if Paisley had been located the other side of the border, in Sunderland or Northumbria, it would be voting Leave and flirting with Ukip. But in the most deprived areas here, Labour activists tell me the EU referendum tally was still almost 50-50, and overall the town voted Remain.

There is a view that Brexit is an English concern. “We haven’t picked up anything about the EU referendum,” says Lawler of his doorstep conversations. “What people are talking about is the independence referendum, Jeremy Corbyn and the kids’ ward.” Scotland’s health secretary, Shona Robison, is due to make a decision on whether the specialist ward should be moved to a large hospital in the First Minister’s Glasgow constituency, against the wishes of many Paisley residents. The hospital in question is nicknamed “the Death Star”.  

Another concern, reminiscent of small towns across the UK, is the decline of the high street. When I walk down the historical shopping area Causeyside Street, I find mother and daughter Kate and Linda Hancy packing up what remains of The Pattern Café and Gift Shop. The wallpaper is a glorious Paisley print, but the scented candles are in boxes and a spray soap bottle hangs from a chair. After two years of trying, they are closing down.  

“People just don’t have money to spend,” Kate says. “A lot of people have been on the same wage for more than five years.”

Linda chimes in: “The cost of living going up but wages aren’t the same. I work in a supermarket, and people come in and say ‘How did I spend this much money?’ A lot of people are paying by credit cards.”

The Hancys voted to remain in the UK, and the EU. Although they knew Alexander, they have never met Mhairi Black, and feel devolution, if anything, has made politicians less accountable. “Why are we picking 1,2,3,4,” demands Kate, referring to Holyrood's voting system, which rejected first past the post. “Why can’t we pick one like we used to?”

Without the EU to blame, the most obvious culprits for Paisley town centre’s decline are the out-of-town shopping centres, where cinemas are opening just as historical ones in town close their doors.

Gavin Simpson, owner of Feel the Groove, a new record shop, remembers the 1980s, when a new release would have shoppers queuing round the block. However, he believes the town is over the worst. (As we speak, a customer comes in to reserve such a record and cheerfully warns Gavin that “even if I ask for my money back, don’t give it to me.”)

One thriving business is the longstanding butchers, Wm Phelps. Manager James Peacock tells me it is down to the trustworthy Scottish produce, which is carefully tracked and labelled. But the business has also embraced globalisation.  After noticing a large number of South African customers, Peacock began selling boerewors and biltong.

The other referendum campaign

If Paisley has been spared the divisions of the EU referendum campaign, its “buddies” – as residents are known – are still reeling with the repercussions of an earlier referendum, that on Scotland in the UK. In 2014, the town voted for independence, although the county overall opted to stay in the UK. 

The town is home to a particularly brash strain of indyreffers, including the “Smith Commission burners”, three SNP councillors who gathered in front of the council headquarters to burn a copy of the report setting out new powers for Scotland. One of them, Mags MacLaren, went on to manage Black’s constituency office.

But if the Paisley independence movement has been well covered, less is known about its opposite - the rise of pro-unionism. 

Of the three mainstream parties opposed to independence, it is the Scottish Conservatives, with their unconventional leader Ruth Davidson, who have most effectively capitalised on the pro-union message. In the 2016 Scottish Parliament elections, the Tory Jackson Carlaw captured the West of Scotland constituency of Eastwood, which had been held by Labour since its creation. 

In Holyrood, the Scottish Tories benefit from proportional representation, which allows voters to choose a constituency MSP but also rank parties. 

According to Paul Masterton, the Tory candidate for East Renfrewshire, and the secretary of the Renfrewshire and Inverclyde Scottish Conservative Association, the Conservatives are now getting huge numbers of first preference votes, including in neighbourhoods like the suburb of Ralston, where both Black and Masterton are from. So who are these voters? Masterton describes them as “New Labour voters who were happy with Tony Blair and Gordon Brown but didn’t like Jeremy Corbyn and get tied up into knots by [Scottish Labour leader] Kezia Dugdale flipflopping on the union stance".

The 2016 election saw the Scottish Conservatives surge to second place in Scotland – a superb comeback for a party once ridiculed as being rarer than pandas. The next electoral test is the local council elections. In Paisley, even Labour activists acknowledged the Conservatives were likely to be the most notable winners.

“For a long time we simply didn’t go out in Paisley," says Masterton. "We were written off and we allowed ourselves to be written off.”

But the referendum has changed this. “What I found was that last May, people weren’t shutting the door in your face," he adds. "Once you started the conversation they were far more receptive to that.” 

Like the Labour activists, Masterton argues that the constitutional question matters more than Brexit. “When Theresa May said ‘now is not the time’, I think a lot of people across Paisley did a small quiet fist pump,” he says of a second independence referendum.  

Ironically, after the early election is called, the Scottish Conservatives do everything they can to mention the prospect. “Don't mention the 'i' word,” crows a recent press release about the “SNP indyref ban”. Davidson tweets: “Nicola doesn't want to stand on her record. She knows the country doesn't want her #indyref2.” A Panelbase survey commissioned by The Sunday Times Scotland published shortly after the early election was announced finds support for the Conservatives at Scotland at 33 per cent, 18 percentage points higher than in 2015. 

What you stand for

For now, Paisley remains a Scottish National Party stronghold. George Adams, the MSP with an office off the high street, proves elusive – Labour activists confirm his reputation as a hardworking local. Black’s aide turns down my request for an interview for similar reasons, but I bump into her that evening at a protest against cutting child tax credits in Glasgow’s George Square.

Black, an admirer of the left-wing Labour figure Tony Benn, once said she feels "it is the Labour party that left me". I ask her if she, like her Labour predecessor, holds surgeries in supermarkets. Black says she’d considered it, but given the sensitivity of some of the issues, such as benefit problems, she thought her constituents might appreciate a more private space. “The main thing that crosses the door in my offices is Universal Credit changes,” she explains. She says she has raised her concerns about the children’s ward.

As for the independence debate, she argues that the Scottish government have been “incredibly compromising” since Brexit, but adds: “A lot of folk want another chance at the question.”

Black is standing for re-election. With a majority of more than 5,000, and neither of her previous challengers in the running, she’s likely to keep her seat, even if buddies' discontent over local issues rumbles on. 

Still, as I have discovered, the 2014 referendum continues to reverberate in towns like Paisley. It has divided friends and neighbours on constitutional lines, galvanised new strains of politics, and brought a Labour heavyweight crashing down, with no appetite to return. 

The Tories believe their unionist message is enough to flip seats like East Renfrewshire, once Conservative, then Labour, and now an SNP marginal. As the SNP's shine wears off, could Paisley, with its long tradition of the left, one day follow? It no longer feels implausible. “The one thing about the Scottish Conservatives - and this is true whatever you like us or not,” says Masterton. “You know what we stand for.”

 

Julia Rampen is the digital news editor of the New Statesman (previously editor of The Staggers, The New Statesman's online rolling politics blog). She has also been deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines. 

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